Change is constant and the digital age is moving us away from physical content to electronic. As a bookseller, Barnes & Noble must have asked themselves the question, what is my strategic purpose and how do I stay relevant in a changing world. They have created a physical place to purchase reading materials, audios and videos, and grab a cup of coffee. But that world is changing, slowly at first, but moving toward a digital direction. And so to remain relevant as purchase behaviors shift, Barnes & Noble recognizes the importance of being the distribution point, both with brick and mortar and with virtual. Their purchase of Fictionwise is that first step.
So how do they compete with Amazon and the Kindle. Will content be available to be read on a Kindle or Sony e-reader or all or something of their own making. Will it make deals to have exclusive digital rights to certain content? And should they integrate e-books into their physical stores so that the purchase of a book includes a free or discounted e-version as well. How do they differentiate from Amazon and others to remain competitive as usage patterns evolve.
Theaters didn't go away when movies were available directly in the home. Book stores shouldn't go away either. Consumers like to get out of the house and Barnes & Nobel provides a place to hang out, discover new ideas, and relax. Creating an impetus to come in the store to download as opposed to just downloading at home could keep this bookseller relevant to the tech savvy consumer. The growth of e-books is fast although the aggregate is still a sliver of total book purchases. Change may not be quick but it seems to be coming and Barnes & Nobel seems to recognize that they need to adapt as well.
Friday, March 6, 2009
Thursday, March 5, 2009
WNBC goes digital in big news update with new channel New York Nonstop
WNBC, Channel 4 in New York City is unveiling a new digital channel on Monday, part NY1, a NYC local cable news outlet, part Headline News, part web-like content. This new channel, dubbed New York Nonstop will be out there on the digital cable line-up and over the digital airwaves as channel 4.2. As viewing habits move to DVR and VOD, the best way to survive is to be live and lively; and with a regional focus meant to provide relevant flavor in short, easy bites. "'You'll get your meat - your news, weather and headlines - every 15 minutes,' McGinn ( Meredith McGinn, senior manager of special projects for NBC 4 New York) said. 'In between those 15 minutes, you may have a two-minute segment, a two-minute pod, a five-minute pod. So the shows we're looking at are in little bits, not your traditional half-hour newscasts.'"
Will audiences in this market switch from NY 1 or News 12 to taste this new dish? Will they prefer the friendly faces of Channel 4 doing double duty at 4.2? In recent months, NBC has laid off a number of anchors, reporters, and weather people, replacing them most likely with less expensive talent. In a start up, keeping costs low is important.
Why is a regional channel being created in today's climate? Frankly, it's a first strategic step that sees the end of owned and operated networks and their eventual replacement with less costly regional news and lifestyle channels. As network programming finds its way as a national feed, accessible on demand, on the web and perhaps still as a linear stream, the regional networks will be left in the dust. And why should these network affiliates promote a national show if they are also competing with that same show on other platforms like Hulu or TV.com or Fancast? Shows like 30 Rock, Heroes, Chuck, and others are all available outside the gate of WNBC. New York Nonstop might just represent the natural next phase of the local broadcaster, no longer reliant on a relationship with its national partner, and programmed 24/7 on regional interests.
Technology has changed the entertainment landscape and the current model of national networks and regional affiliates may no longer be working. The evolutionary change may just be a digital news and lifestyle network, a la New York Nonstop in every DMA. Heck, their tagline says it all - Engaging consumers where they live, work and play.
Will audiences in this market switch from NY 1 or News 12 to taste this new dish? Will they prefer the friendly faces of Channel 4 doing double duty at 4.2? In recent months, NBC has laid off a number of anchors, reporters, and weather people, replacing them most likely with less expensive talent. In a start up, keeping costs low is important.
Why is a regional channel being created in today's climate? Frankly, it's a first strategic step that sees the end of owned and operated networks and their eventual replacement with less costly regional news and lifestyle channels. As network programming finds its way as a national feed, accessible on demand, on the web and perhaps still as a linear stream, the regional networks will be left in the dust. And why should these network affiliates promote a national show if they are also competing with that same show on other platforms like Hulu or TV.com or Fancast? Shows like 30 Rock, Heroes, Chuck, and others are all available outside the gate of WNBC. New York Nonstop might just represent the natural next phase of the local broadcaster, no longer reliant on a relationship with its national partner, and programmed 24/7 on regional interests.
Technology has changed the entertainment landscape and the current model of national networks and regional affiliates may no longer be working. The evolutionary change may just be a digital news and lifestyle network, a la New York Nonstop in every DMA. Heck, their tagline says it all - Engaging consumers where they live, work and play.
Wednesday, March 4, 2009
Cable Companies Target Commercials to Audience
Your gonna get the commercial included with your TV show anyway, why not get ads that are relevant to you. Technology enables ads to be targeted by set top box so that your home receives ads that match your demographic profile. And while my cable company knows I have a house and x number of cable boxes, they still don't know what I drive or what I buy; they rely on the zip code of my neighborhood to ascertain my economic situation. Or do they?
How much information is being collected and shared and cross referenced with my cable bill. And should I care. On the plus side, the ads that I get might have more interest to me. They might be more a resource than a distraction and be of great value to both me and the advertiser. And as the demographic information is aggregated, my personal information remains personal. "Cablevision says it segments its subscribers only by demographics, so that an advertiser can divide ads among various groups: General Motors, for example, could send an ad for a Cadillac Escalade to high-income houses, a Chevrolet to low-income houses, and one in Spanish to Hispanic consumers."
On the negative side, the question is one of it being a slippery slope. At what point does the aggregate data become personal data. Privacy does matter and needs to be protected. "The potential of customized ads worries some privacy advocates, despite the assurance of cable companies that they maintain anonymity about the households." Cablevision says they are extra protective that personal information is not shared.
And what of Canoe Ventures. Is Cablevision ahead of their efforts or simply not wanting to play in the same sand box as Canoe. Personalization is happening on the web, it only makes sense that it invades the TV, too.
How much information is being collected and shared and cross referenced with my cable bill. And should I care. On the plus side, the ads that I get might have more interest to me. They might be more a resource than a distraction and be of great value to both me and the advertiser. And as the demographic information is aggregated, my personal information remains personal. "Cablevision says it segments its subscribers only by demographics, so that an advertiser can divide ads among various groups: General Motors, for example, could send an ad for a Cadillac Escalade to high-income houses, a Chevrolet to low-income houses, and one in Spanish to Hispanic consumers."
On the negative side, the question is one of it being a slippery slope. At what point does the aggregate data become personal data. Privacy does matter and needs to be protected. "The potential of customized ads worries some privacy advocates, despite the assurance of cable companies that they maintain anonymity about the households." Cablevision says they are extra protective that personal information is not shared.
And what of Canoe Ventures. Is Cablevision ahead of their efforts or simply not wanting to play in the same sand box as Canoe. Personalization is happening on the web, it only makes sense that it invades the TV, too.
Tuesday, March 3, 2009
Thomson Reuters Builds A Web-Only TV Network
Why are TV broadcasters losing money? As the internet opens up distribution and lowers the barriers to enable more content to be created and disbursed, revenue growth has not kept pace. Clearly cable advertising growth has come at the expense of broadcasters, but now web shows provide an alternative to cable. Plainly, the result is that our viewing choices have gone from a few to infinite.
Where the few UHF stations once offered an alternative to the big broadcasters, today cable and web programming has truly fragmented the market. But for how long? Marketing theory indicates that eventually fragmentation must return to segmentation. Want some examples, just look at the accounting industry, the airline industry, and even with cable operators. Where once there were many, now there are few. How quickly will content distribution consolidation occur is anyone's guess. But for the health of the marketplace, given a recessionary climate where fewer advertising dollars are available, sooner may be better than later.
Not to pick on any particular genre or network, but let's look at the abundance of choices. With Thomson Reuters Web Network now competing in a business news space currently occupied by CNBC, Bloomberg, and Fox Business News. How long can that last? Looking for a movie on TV, there is ABC Family, AMC, Bravo, Disney, FMC, FX, Hallmark, Lifetime, TBS, TNT,TCM, WE, and broadcast and premium networks like HBO and Showtime, and others. And now we can access movies on the web through Amazon and Netflix. The same holds true for sports, kids, cultural, lifestyle, and every other niche. Niche networks become general interest in an attempt to capture more advertising dollars, and new niche networks arise attempting to reach the purer interest feeling abandoned as their previous network becomes too general. A network once considered the place for culture and fine arts must broaden its appeal to grow its viewership base. How many do we really need?
The problem remains, not enough advertising dollars to support these fragments. Already magazines are beginning to shutter, some newspapers are going bankrupt, others are closing. Web content may see the loss of some of these cable channels or some consolidation must occur. This fragmentation of content cannot survive. Those managing their bottom line may win out, some others will not.
Where the few UHF stations once offered an alternative to the big broadcasters, today cable and web programming has truly fragmented the market. But for how long? Marketing theory indicates that eventually fragmentation must return to segmentation. Want some examples, just look at the accounting industry, the airline industry, and even with cable operators. Where once there were many, now there are few. How quickly will content distribution consolidation occur is anyone's guess. But for the health of the marketplace, given a recessionary climate where fewer advertising dollars are available, sooner may be better than later.
Not to pick on any particular genre or network, but let's look at the abundance of choices. With Thomson Reuters Web Network now competing in a business news space currently occupied by CNBC, Bloomberg, and Fox Business News. How long can that last? Looking for a movie on TV, there is ABC Family, AMC, Bravo, Disney, FMC, FX, Hallmark, Lifetime, TBS, TNT,TCM, WE, and broadcast and premium networks like HBO and Showtime, and others. And now we can access movies on the web through Amazon and Netflix. The same holds true for sports, kids, cultural, lifestyle, and every other niche. Niche networks become general interest in an attempt to capture more advertising dollars, and new niche networks arise attempting to reach the purer interest feeling abandoned as their previous network becomes too general. A network once considered the place for culture and fine arts must broaden its appeal to grow its viewership base. How many do we really need?
The problem remains, not enough advertising dollars to support these fragments. Already magazines are beginning to shutter, some newspapers are going bankrupt, others are closing. Web content may see the loss of some of these cable channels or some consolidation must occur. This fragmentation of content cannot survive. Those managing their bottom line may win out, some others will not.
Monday, March 2, 2009
Why Media Must Charge For Web Content
The Wall Street Journal charges for it's online content, and Newsday wants to. While free content continues to exist, the premium content depends on revenue to support its business model. In the broadcast model, networks depended on advertising fees, and TV shows built in syndication as a means to further profit. In the cable model, networks depended on both subscription fees and advertising to prosper. Broadcast liked this model so much, they bought cable networks. Local stations came up with retransmission consent to get subscription fees from cable affiliates as well. And then the web showed up.
The barriers of digital distribution dropped away and content could be shared freely, copied for networks and web pages, and share with the click of a button. Why pay for content if it can found for free in alternate locations. Why pay for the chicken if the eggs are free. But eventually someone has to feed the chicken or it will die and there will be no more eggs.
Content creators and distributors are recognizing the value of their content and how it needs to be shared, as either promotional vehicles or to build brand preference. But eventually, the online viewer will have to pay. Content can't be free forever and advertising revenue may not be enough by itself to maintain the current model. Either costs have to drop or more revenues have to be found. At the moment, content companies are cutting costs, but if it is too much, the content will suffer.
WIll consumers pay. Some are already. Apple has built the iPhone that makes it too easy to buy applications and view content. Perhaps it is that simplicity and a pricing structure deemed reasonable by consumers that will build an online subscription model. Will the cable companies be able to control the pipeline enough to limit only purchased content to come through to the device? Will free content be pulled and limited to subscriptions like Netflix? The model must change to enable a real business to develop; what it eventually looks like is still to be determined.
The barriers of digital distribution dropped away and content could be shared freely, copied for networks and web pages, and share with the click of a button. Why pay for content if it can found for free in alternate locations. Why pay for the chicken if the eggs are free. But eventually someone has to feed the chicken or it will die and there will be no more eggs.
Content creators and distributors are recognizing the value of their content and how it needs to be shared, as either promotional vehicles or to build brand preference. But eventually, the online viewer will have to pay. Content can't be free forever and advertising revenue may not be enough by itself to maintain the current model. Either costs have to drop or more revenues have to be found. At the moment, content companies are cutting costs, but if it is too much, the content will suffer.
WIll consumers pay. Some are already. Apple has built the iPhone that makes it too easy to buy applications and view content. Perhaps it is that simplicity and a pricing structure deemed reasonable by consumers that will build an online subscription model. Will the cable companies be able to control the pipeline enough to limit only purchased content to come through to the device? Will free content be pulled and limited to subscriptions like Netflix? The model must change to enable a real business to develop; what it eventually looks like is still to be determined.
Friday, February 27, 2009
Hearst Building A Kindle For Magazines
Sure print media is declining as consumers prefer multimedia functionality. And Hearst has built a tremendous variety of content that can and must adapt to new technologies. Production of print content as well as its distribution is a labor intensive, expensive cost line on the budget and transitioning to electronic distribution can be very cost effective. Per Fortune, "According to industry insiders, Hearst, which publishes magazines ranging from Cosmopolitan to Esquire and newspapers including the financially imperiled San Francisco Chronicle, has developed a wireless e-reader with a large-format screen suited to the reading and advertising requirements of newspapers and magazines. The device and underlying technology, which other publishers will be allowed to adapt, is likely to debut this year."
For me, I don't think that Hearst should move away from its core competencies and become a manufacturer of an e-reader. And making a product that merely duplicates the Kindle does not seem the way to go. Yes a bigger screen would make sense, but can Hearst build it at a price point that would cause consumers to take notice. And a black and white e-reader is not how glossy magazines are meant to be viewed. Readers need to be in full color.
Hearst should instead partner with either Sony, who could use some help competing with the Kindle, or with Apple, who definitely understands what a product needs to do to gain market share. Heck, its an iPod on steroids! Or simply remain neutral and allow subscriptions regardless of the reader the consumer chooses to use. For content creators like Hearst, that is perhaps the best solution of them all.
Thursday, February 26, 2009
Netflix Is Really Serious About Streaming-Only Subscription
Should cable operators and pay TV programmers like HBO and Showtime be worried about Netflix. At a monthly subscription rate at half what cable charges, a Netflix subscription could be economically better and equally as enjoyable for the movie fan. Currently, "Netflix passed the 10 million subscriber mark earlier this month and during its last earnings call Hastings said “millions” (emphasis on the “s” there) of subscribers had used the service." I wonder during that same period if HBO and Showtime have grown or seen attrition. As Netflix creates pricing options for the casual to heavy user, it can be a welcome change to the high price of premium content.
So how should HBO and Showtime compete. Competing with their own streaming content is one option. Adding mobility to the mix so that a subscriber can access their premium stream away from the home is another. Pushing its original and exclusive content is a third means. And revisiting its pricing models in the face of competition is another. Otherwise, Netflix is bound to take business away from HBO, Showtime, and other movie networks. I mean would you rather watch a movie on TV with commercials or streamed through Netflix without.
So how should HBO and Showtime compete. Competing with their own streaming content is one option. Adding mobility to the mix so that a subscriber can access their premium stream away from the home is another. Pushing its original and exclusive content is a third means. And revisiting its pricing models in the face of competition is another. Otherwise, Netflix is bound to take business away from HBO, Showtime, and other movie networks. I mean would you rather watch a movie on TV with commercials or streamed through Netflix without.
Wednesday, February 25, 2009
10 reasons to buy a Kindle 2… and 10 reasons not to
Boy the Kindle sure looks like a great product and Jeff Bezos is everywhere talking up its virtues. This article provides compelling reasons why to buy one and compelling reasons why not. For those early adopters, the Kindle represents the next device that will be a must have for anyone who reads books, magazines, and newspapers. And it is very green, saving our trees.
At the same time, it is at a price point that will slow down that adoption. At just under $400, it will take quite a lot of e-book purchases to offset the cost of the printed product. If an average e-book is $10 and an average hard cover book is $18, the incremental $8 savings means that you have to buy 50 books to break even. Before I do, I expect at least to see a Kindle 3 or Kindle 4 released!
Will function beat cost; will customers flock to the Kindle because it is futuristic and despite the cost. We will soon find out. For me, at this high price point, I may still wait another generation. I too like the feel of the printed material in my hand.
At the same time, it is at a price point that will slow down that adoption. At just under $400, it will take quite a lot of e-book purchases to offset the cost of the printed product. If an average e-book is $10 and an average hard cover book is $18, the incremental $8 savings means that you have to buy 50 books to break even. Before I do, I expect at least to see a Kindle 3 or Kindle 4 released!
Will function beat cost; will customers flock to the Kindle because it is futuristic and despite the cost. We will soon find out. For me, at this high price point, I may still wait another generation. I too like the feel of the printed material in my hand.
Tuesday, February 24, 2009
Why Do So Many People Still Search for Hula
Is Hulu really a great brand name for the NBC Fox online venture. It would be fascinating to see how many times it is mistyped in the search as Hula instead of Hulu. Google rightly asks if you really mean Hulu. If I had only bought the Hula.com web site, I could have made a small fortune. Hulu has quickly grown and certainly more people are becoming familiar with its name. One day it may make for an interesting case study. A great aggregator of content, a crazy name.
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